C&R slumps on new issue

Shares in shopping mall and leisure centre property investor Capital & Regional today halved in value as it unveiled a fund-raising and a first-half loss of £135 million. The share price fell 53p to 45p.

The new shares are being offered to investors at just 24p — a 75% discount to last night's closing price, with South African group Parkdev agreeing to take a 25% stake. Alongside an underwritten offer to existing shareholders, the group will raise £69.2 million of new money.

The value of the property portfolio managed by C&R has fallen from £5.3 billion to £3.2 billion in the last 12 months.

In the last six months, the fall was £800 million. The company's net asset value has fallen from 706p to just 71p in the last year. C&R has renegotiated a number of loans and two of the property funds it advises have raised their own finance in recent months.

Chairman Tom Chandos said: "The group should, as a result, be in a position to exploit its established community and leisure asset management skills to enhance the value of existing funds, and take advantage of investing opportunities once the turn in the market occurs."

The group said it had seen 103 shops in its malls go into administration in the first six months of the year, with 73 in the first quarter and 30 in the second.

This represents 5% of the total rental of the malls — although more than half were still generating rent by trading in administration or having been re-let.